Business Ethics in China: Challenges and Opportunities
By Margaret Steen
panelists offered their views on Business Ethics in China:
Challenges and Opportunities at the Markkula Center for
Applied Ethics fourth biennial business ethics conference
on March 9. The topic of the conference was Business Ethics
in a Global World with a focus on China and India.
Baocheng Liu discussed how the confluence of three philosophical
traditions in China Daoism, Confucianism and Buddhism
has contributed to what he called the great coherence
of the Chinese culture. Liu, who is dean of the Sino-French
School of International Management in Beijing, noted that despite
invasions and wars, this country remains as it is.
The confluence and also the integration of these three
great philosophies continue to bond China, Liu said. They
also offer insight into building a stakeholders society,
which the Chinese might call a harmonious society.
L-R :Baocheng Liu and C.S. Park
L-R: C.S. Park and James O'Toole
Park, a member of the board of directors of Seagate and
the former chairman and chief executive officer of Maxtor, shared
several insights he had learned from building a factory in China.
Does the cultural difference really matter? he
asked. In theory, he said, it shouldnt a business
has the same goal anywhere in the world. But in practice, it
A second question is whether business ethics can be taught.
Park said his experience suggested it could be, at least to
a certain extent. For example, he had seen Chinese managers
learn that it raises ethical questions to recommend that their
employer purchase goods from companies in which they themselves
Park is optimistic about the future, particularly because of
the vast number of well-educated Chinese and the increasing
number who have business experience. He noted that Chinese students
are very interested in learning about how Western companies
work. We have lots of obligations in terms of teaching
them, showing best practices to them, he said.
James OToole, a senior research scientist at the
Center for Effective Organizations at the University of Southern
California and an expert on corporate culture and leadership,
noted the remarkable transformation of Chinas economy,
especially in the big cities. He said Chinas leaders now
seem intent on showing the world that the country is coming
into its own. But he also spoke of problems, including a recent
trip to Africa by Chinas president in which he was in
some cases treated like a 19th century European colonialist.
He said that Europeans and Americans are reacting differently
to the rise of India than to the rise of China. India, with
its concepts of democracy and freedom, and its grounding in
religious traditions, is more comparable to the West, he said.
Those who assume those values are universal, may be wrong,
according to OToole. He told of showing the film Gandhi
to a group of Chinese business people. Its a film he has
used in many countries to launch a discussion of moral leadership.
But with this Chinese group, his questions fell flat. Finally
one participant said, Gandhi is wrong. If somebody
hits you, you hit them back, OToole recalled.
OToole also told of being on the board of a company that
built a factory in China; the company was constantly faced
with paying bribes, he said. The result, in his view,
was that the company found itself compromising ethical standards,
though not breaking the law.
Finally, OToole noted that U.S. corporations needed to
get their own house in order if they want to assume moral leadership.
And he called patronizing the idea that a vibrant
civil society and a free press are Western ideals being imposed
Li, managing director of Atelier Capital, said Western countries
are hardly immune from ethical problems, citing Enron and insider
trading scandals. He noted that a Western perspective on business
ethics in China would probably note that corruption is common,
particularly in rural areas; that some of Chinas cities
are among the most polluted in the world; and that corporate
governance is rare.
He described his experience from 20 years ago, helping an American
company explore a possible joint venture in China. During three
years of negotiation, which ultimately ended without the partnership
being formed, Li said no one on the Chinese side of the negotiations
ever mentioned that the process could be speeded up with a bribe.
On paper, China had tough environmental standards much
tougher than those in the U.S.
Li said that despite instances of corruption and unethical
business practices, there is also something very positive about
Chinese business ethics. And he noted that many of the new generation
of Chinese business leaders have been trained in the West, and
that there is lots of interest in China in translations of management
Margaret Steen is a freelance journalist.